The project off Aberdeen will support up to 3,500 jobs and generate billions of pounds of tax revenues.
A long-awaited drilling licence for the Jackdaw gas field is set to be approved this week, according to senior industry sources.
The North Sea project, situated off the coast of Aberdeen, will generate billions in tax revenues while supporting up to 3,500 jobs.
It will also be capable of directly suppling the UK grid at a time when focus has been placed heavily on energy security amid global insecurity.
Environmentalists however warned it will emit millions of tonnes of carbon and that it will distract from the development of green energy alternatives.
A senior industry source told the Sunday Mail: “We are expecting the final ministerial approval this week, the decision was made weeks ago and it has just been a question of when to announce.
“This will be the biggest boost to the North Sea industry in over a decade. It will secure thousands of jobs for many years and we would hope to have production up and running in months.
“Jackdaw is the largest untapped gas field in the UK and we need to be realistic about future consumption at a time when war in the Middle East and between Russia and Ukraine is putting severe pressure on global supply and prices.
“This is part of the process of transitioning to green energy because we are preserving engineering skills in Scotland that are going to be critical for the future.”
The project has been awaiting approval since 2024 due to a High Court ruling that a previous licence was invalid because it had not taken all environmental consequences into account.
However, Energy Secretary Miatta Fahnbulleh is expected to announce that drilling on Jackdaw can now go ahead after a new assessment by the Offshore Petroleum Regulator for Environment and Decommissioning.
A separate licence for the Rosebank oil field off Shetland is also under consideration but a decision is not expected until later in the Autumn.
Scottish Secretary Douglas Alexander told the Sunday Mail there would be “no cliff edge for the North Sea”.
He said: “Our approach to the North Sea as the UK Government is pragmatic, not ideological. I want every family in the North East, and right across Scotland, whose wages come from offshore to hear that loud and clear.
“The North Sea is a vital homegrown national asset, and it will help power this country for decades to come.
“On Jackdaw and Rosebank, the Prime Minister has been clear that a decision is coming, and coming very shortly. We’re not backing away from it.
“The decision rests with my Cabinet Colleague, Miatta Fahnbulleh, and it has to follow a proper legal process, but as Secretary of State for Scotland, I’m hoping we’ll see that decision imminently rather than in weeks or months.
“When that decision comes, my priority will remain ensuring Scottish workers, Scottish businesses and Scottish communities are the beneficiaries of that energy future. We’ve helped power the country for half a century.
“I’m determined the next generation of energy jobs is created right here. There will be no cliff edge for the North Sea.”
The companies behind the Jackdaw gas field project are Shell PLC and Norwegian state controlled Equinor which combined their UK offshore oil and gas businesses into a joint venture named Adura.
The Rosebank project is a collaboration between Adura and Ithaca Energy, however Prime Minister Andy Burnham is facing demands to ban Ithaca – a subsidiary of the Israeli Delek Group – due to its links to illegal Israeli settlements.
Former First Minister Humza Yousaf and Green Party leader Zack Polanski have warned granting a drilling licence to Ithaca would breach Burnham’s own trade sanctions.
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